TITLE:  DynCorp International LLC, B-294232; B-294232.2, September 13, 2004
BNUMBER:  B-294232; B-294232.2
DATE:  September 13, 2004
**********************************************************************
   Decision

   Matter of:   DynCorp International LLC

   File:            B-294232; B-294232.2

   Date:              September 13, 2004

   Helaine G. Elderkin, Esq., Carl J. Peckinpaugh, Esq., and Charles S.
McNeish, Esq., for the protester.

   John S. Pachter, Esq., Jonathan D. Schaffer, Esq., Richard C. Johnson,
Esq., Sophia R. Zetterlund, Esq., Erin R. Karsman, Esq., and Edmund M.
Amorosi, Esq., Smith Pachter McWhorter & Allen, for Aegis Defence Services
Limited, an intervenor.

   Capt. Peter Dan DiPaola, Maj. Peter H. Tran, and Raymond M. Saunders,
Esq., Department of the Army, for the agency.

   Ralph O. White, Esq., and Christine S. Melody, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.

   DIGEST

   1.  Protester*s contention that its proposal was unreasonably evaluated
and improperly excluded from consideration for award is denied where:  the
solicitation advised that the agency intended to make award without
discussions if possible; the solicitation also advised that a marginal
rating could mean that the proposal would be ineligible for award without
significant revision; the record shows that the agency reasonably rated
the protester*s proposal as marginal, and ineligible for award without
significant revision; and the agency reasonably limited its final award
decision to the two offerors whose initial proposals were eligible for
award as written.  

   2.  Protester lacks the direct economic interest needed to challenge the
evaluation of the awardee--as well as the interest needed to challenge the
agency*s affirmative determination of the awardee*s responsibility--where
the record shows that the protester*s proposal was reasonably considered
ineligible for award without discussions, and where, even if the
protester*s challenges were sustained, another offeror would be in line
for award ahead of the protester.  

   DECISION

   DynCorp International LLC protests the award of a contract to Aegis
Defence Services Limited by the Department of the Army, pursuant to
request for proposals (RFP) No. W911SO-04-R-0005, issued to procure
security services for contractor and government personnel in Iraq. 
DynCorp challenges the Army*s evaluation of its and Aegis*s proposals,
argues that the Army was required to consider its proposal in the
cost/technical tradeoff, and contends that Aegis lacked the requisite
responsibility to perform this contract due, in part, to certain alleged
activities of Aegis*s principal director and largest shareholder.

   We deny the protest.

   BACKGROUND

   The RFP here was initially issued by the Coalition Provisional Authority
(CPA), Baghdad, Iraq, on February 13, 2004.  Later that month, the CPA
transferred responsibility for the contract to the Department of the Army,
and on March 4, the Army reissued the solicitation under the
above-referenced solicitation number.  Specifically, the RFP sought
security services, anti-terrorism support and analyses, movement escort
services, and close personal protection services.  The solicitation
contemplated the award of a cost-plus-fixed-fee contract for a 1-year base
period, with up to two 1-year options, to the offeror whose proposal
*represents the Best Value (Cost Technical Trade-offs) to the
Government.*  RFP amend. 5, at 42, 50.  The solicitation also advised that
the agency intended to award without discussions, but reserved the right
to hold discussions if necessary.  Id. at 50.

   To determine which proposal offered the best value to the government, the
RFP anticipated the use of three evaluation factors: 
technical/management, past performance, and cost/price.  Id. at 50-51. 
The RFP advised offerors that technical/management would be slightly more
important than past performance, and that these two factors combined would
be more important than cost/price.  Id. at 51.

   Due to the issues raised in this protest, a detailed recitation of the
evaluation subfactors and rating schemes in the RFP is necessary, and is
set forth below. 

   With respect to the technical/management evaluation factor, the RFP
identified four  equally important subfactors:  technical/management
methodology and responsiveness; the offeror*s response to a hypothetical
problem identified in the solicitation (*hypothetical problem*); staffing
plan; and personnel qualifications.  Id. at 52.  Each of these subfactors,
as well as the overall factor, was to be assigned a rating of excellent,
good, marginal, or unsatisfactory.  Of relevance here, the RFP reserved
the ratings of *excellent* and *good* for proposals *that can be awarded
*as submitted* and [contain] no deficiencies and/or weaknesses.*  Id. at
51.  In other regards, the ratings of *excellent* and *good* designate the
extent to which a proposal exceeds the basic requirements of the
solicitation, is low in risk, and presents a high likelihood of successful
performance. 

   In contrast, the RFP reserved the ratings of *marginal* and
*unsatisfactory* for proposals that, respectively, *may be correctable
only with a significant re-write of the proposal,* and *could only become
eligible for award if it were substantially revised.*  Id.  In other
regards, the ratings of *marginal* and *unsatisfactory* designate the
extent to which a proposal fails to meet the basic requirements of the
solicitation, is high in risk, and presents a low likelihood of successful
performance.  Of particular importance to this dispute is the definition
of a *marginal* rating in the RFP: 

   *Marginal* is defined as any proposal that contains significant
deficiencies and/or weaknesses.  The proposal fails to meet some of the
objectives/requirements, contains significant deficiencies/
weaknesses/disadvantages and substantial improvement is necessary.  The
proposal, however, may be correctable only with a significant re-write of
the proposal.  The proposal provides for a low probability of success. 
Risk Level - High.

   Id. at 51. 

   Finally, the RFP contains two admonitions applicable to proposals rated
*marginal* or *unsatisfactory* under the technical/management evaluation
factor, or any of its subfactors.  First, the RFP advises that *a
*marginal* or *unsatisfactory* rating in any one subfactor, will result in
a *marginal* or *unsatisfactory* rating for the factor as a whole.*  Id.
at 52.  Second, the RFP advises that *[p]roposals determined to be
Unsatisfactory will be eliminated from further consideration.*  Id. at 51.

   With respect to the past performance evaluation factor, there were no
subfactors identified.  Rather, the RFP advised that the agency would look
to work performed within the past 3 years to determine whether the work
was the same as, or similar in nature, size, and complexity to, the
services being procured here.  Under past performance, a proposal could
receive any of the four ratings described above--excellent, good,
marginal, unsatisfactory--or a rating of neutral, indicating no record of
relevant past performance.  With respect to the cost/price factor, the
agency advised that it would calculate a probable cost for each offeror,
and that this probable cost would be used for source selection purposes. 
Id. at 52. 

   By the March 31 closing date, the Army received seven proposals, one of
which was withdrawn shortly thereafter.  At the conclusion of the
evaluation, DynCorp*s proposal was rated *good* under one
technical/management subfactor (technical/management methodology and
responsiveness), and *marginal* under the threeA remaining
technical/management subfactors (hypothetical problem, staffing plan, and
personnel qualifications); as provided by the RFP, these ratings resulted
in an overall rating of *marginal* under the technical/management factor. 
When combined with DynCorp*s past performance rating of *good,* the
overall proposal rating was *marginal.* 

   In contrast, Aegis*s proposal was rated *good* under the
technical/management evaluation factor, and *neutral* under the past
performance factor, resulting in an overall proposal rating of *good.*  In
addition, a third offeror (designated *Offeror A* in the table below) was
rated *excellent* under the technical/management factor, and *good* under
the past performance factor, resulting in an overall proposal rating of
*excellent.*  A summary of the evaluation results for all six offerors is
set forth below:

   +------------------------------------------------------------------------+
|OFFEROR  |OVERALL RATING|  TECHNICAL/  |  PAST PERF.  | TOTAL EVALUATED |
|         |              |              |    RATING    |                 |
|         |              |    MGMT.     |              |      COST       |
|         |              |              |              |                 |
|         |              |    RATING    |              |                 |
|---------+--------------+--------------+--------------+-----------------|
|Offeror A|  Excellent   |  Excellent   |     Good     | $462.0 million  |
|---------+--------------+--------------+--------------+-----------------|
|Aegis    |     Good     |     Good     |   Neutral    | $292.5 million  |
|---------+--------------+--------------+--------------+-----------------|
|DynCorp  |   Marginal   |   Marginal   |     Good     | $201.0 million  |
|---------+--------------+--------------+--------------+-----------------|
|Offeror B|   Marginal   |   Marginal   |     Good     | $1.042 billion  |
|---------+--------------+--------------+--------------+-----------------|
|Offeror C|Unsatisfactory|Unsatisfactory|   Neutral    |$324.0 million[1]|
|---------+--------------+--------------+--------------+-----------------|
|Offeror D|Unsatisfactory|Unsatisfactory|   Neutral    | $497.3 million  |
+------------------------------------------------------------------------+

   Agency Report (AR), Tab L, at 4, 15.

   Given these results, the source selection authority (SSA) reached several
conclusions.  First, he reaffirmed the Army*s intent, stated in the
solicitation, to make award without discussions.  AR, Tab K, at 10. 
Second, he concluded that the two proposals with overall ratings of
*unsatisfactory* were ineligible for award, and could be eliminated from
further consideration.  Third, he concluded that the proposals of DynCorp
and Offeror B needed substantial improvements to be eligible for award,
and decided that since there would be no opportunity to make improvements,
the proposals could properly be *eliminated from further consideration.* 
Id.  Fourth, he compared the strengths and weaknesses in the proposals of
Offeror A and Aegis, and concluded that the added benefits and advantages
offered by Offeror A*s proposal did not justify incurring the additional
cost.  As a result, the SSA concluded that *it was in the best interest of
the Government to award this contract to [Aegis].*  Id. 

   Finally, in the interest of *thoroughness,* the SSA noted that while the
proposals of DynCorp and Offeror A were *ineligible for award* without
discussions, even if the SSA considered those proposals, he would not
select either of them over the Aegis proposal.  Id.  In addition, the SSA
set forth his rationale for his conclusions.  This protest followed.

   ANALYSIS

   DynCorp*s arguments fall into four categories--challenges to its own
evaluation, challenges to the evaluation of Aegis*s proposal, a challenge
to the SSA*s decision to exclude DynCorp*s proposal from the final
selection decision, and a challenge to the agency*s determination that
Aegis has the requisite responsibility to perform the contract here.

   With respect to its own evaluation, DynCorp argues that the marginal
ratings it received under three of the four technical/management
subfactors were unreasonable, and hence its rating of marginal under the
technical/management factor itself was also unreasonable.  Our standard in
reviewing such challenges is to examine the record to determine whether
the agency*s judgment was reasonable and consistent with stated evaluation
criteria and applicable statues and regulations.  ESCO, Inc., B-225565,
Apr. 29, 1987, 87-1 CPD PA 450 at 7.

   The Evaluation of DynCorp*s Staffing Plan

   One of the major alleged shortfalls in DynCorp*s proposal relates to its
staffing plan.  As indicated above, staffing plan was one of four
equally-weighted subfactors under the technical/management evaluation
factor, and under this subfactor DynCorp received a marginal rating. 

   Of relevance here, the RFP, under the heading of security escorts and
movement control, required that the contractor

   provide transportation and personnel protection of personnel from
terrorist or criminal attacks during travel to/from secure project
worksites for as many as an average of 75 roundtrips daily, anywhere in
Iraq, which would entail personal protection for an average of two (2)
[Program Management Office] travelers.  Contractor services shall include
all protective/defensive actions required to counter, deter, detect, and
respond to threats to designated personnel through threat analysis,
operations security (OPSEC), responsive communications, and integrated
team support using armed vehicle escorts, as necessary.  Armed vehicle
escort will consist of contractor security personnel providing armed
security utilizing armored vehicles.  For planning purposes, there is no
minimum number of security personnel specified for each escort mission.

   RFP amend. 5, at 3.2.3 (p.13).  This requirement sparked a number of
clarification questions from potential offerors seeking additional
guidance about matters such as the average roundtrip mileage of an
escorted trip, the maximum number of travelers on a trip, the number of
regions within Iraq involved in a trip, and the number of trips that might
require motorcades.  One questioner asked how many of the 75 trips per day
would occur simultaneously.  The answer:  *This will be dependent on each
day*s unique situation but use +/- 20 for a rough estimate.*  RFP amend.
8,
question 15.  

   In the portion of its proposal wherein DynCorp explained its approach to
providing security escorts and movement control, under the heading
*Staffing,* the proposal narrative made reference to the number of
simultaneous trips, but not to the total underlying number of trips per
day, as set forth below:

   DynCorp made an assumption in computing the Regional Security
Escort/Movement Control requirements, based on Amendment 0008, Response 15
that suggests for planning we use a rough estimate of +/a**A 20 missions
per day of an unspecified duration.  Our assumption led us to propose
staffing 4 PSDs [Personal Security Detail] at the National, one PSD at
each Regional level, and 16 Security Escort/ Movement Control Teams at the
Governorate level.  All inclusive, DynCorp will provide 26 security escort
teams--including PSD and Security Escort/Movement Control Teams--which
meet the specified requirements (+/-20), allows for overflow personnel to
meet unspecified missions and ensures the ability to meet motorcade
operational needs throughout Iraq during Phase-In.

   DynCorp Proposal, vol. II, at 24.[2] 

   In evaluating DynCorp*s proposal, the Army--and in particular, the
SSA--was concerned that DynCorp had misread the solicitation and had not
proposed a sufficient number of security escort teams to provide an
average of 75 trips per day, with as many as 20 of those trips occurring
simultaneously.  AR, Tab K (Source Selection Decision), at 5-7.  The Army
explained this concern in detail during its debriefing of DynCorp.  AR,
Tab P-1, at 10-13.

   In its protest, DynCorp argues that a rating of marginal for its proposal
under the staffing plan subfactor is based on a misreading of its proposal
by the Army.  Specifically, it argues that it did not overlook the 75
roundtrip per day requirement; that the Army overlooked other places in
its proposal where it explicitly acknowledged the requirement; and that
the matter was, at best, ambiguous, and could have been resolved through
clarifications.  We disagree with DynCorp on each of these counts.

   As an initial matter, we think DynCorp glosses over the fact that its
proposal explains not once, but at least twice, that it is based on an
assumption that the RFP here requires *+/- 20 missions per day.*  In
addition, the sections of the proposal where DynCorp sets forth this
assumption are the crucial sections related to its proposed number of
escort teams--i.e., in the section explaining its proposed staffing, and
in the section explaining how its direct labor costs were derived.  While
DynCorp correctly points out that the Transportation section of its
proposal (see AR, Tab D-2, at 9) repeats the RFP*s requirement of 75
roundtrips per day, the Transportation section is ancillary to the more
basic requirements of this RFP; in fact, Transportation is one of several
subsections--the others are Clearances, Quality Control, Training, and
Purchasing--lumped together under the heading *How Major Functions Will Be
Accomplished.*  Id. at 8.  Given the unambiguous statements in DynCorp*s
proposal--and the places where it made them--we see nothing unreasonable
about the Army*s conclusion that DynCorp misread the RFP.

   Nonetheless, even if we assume that DynCorp did not misread the RFP and
that its narrative explanation of its assumptions merely contained an
error, the agency concluded that DynCorp did not propose enough escort
teams to meet the solicitation requirements.  In this regard, the SSA
calculated that DynCorp was offering 23 escort teams,[3] and that even if
the number of simultaneous missions never exceeded 20, DynCorp had not
planned for enough escort teams *to allow for rest, refueling, refitting,
planning, and unforeseen circumstances, while still accomplishing the
requirement of seventy-five (75) daily missions.*  AR, Tab K, at 7.  In
our view, there is nothing about this conclusion that is unreasonable.[4] 
In fact, other than a single response suggesting that *[i]t may even be
possible that one escort team, by itself, could serve 75 missions in one
day,* Protester*s Comments, Aug. 2, 2004, at 11, DynCorp has raised no
challenge to the Army*s evaluation conclusion about its proposed number of
escort teams.  Instead, the protester complains that any issue regarding a
shortfall in its proposed number of escort teams could have been remedied
during clarifications.  We disagree. 

   As defined in Federal Acquisition Regulation S 15.306(a), clarifications
are exchanges between an agency and an offeror after receipt of proposals
that are limited to clarifying some aspect of a proposal, or to resolving
minor or clerical errors when award without discussions is contemplated;
clarifications are not to be used to cure proposal deficiencies or
material omissions, or materially alter the technical or cost elements of
the proposal, or otherwise revise the proposal.  eMind, B-289902, May 8,
2002, 2002 CPD PA 82 at 5.  Here, asking about, and allowing DynCorp to
make an upward adjustment to, its proposed number of escort teams--and to
make the corresponding upward adjustment to its proposed costs--would not
have been a clarification; on the contrary, such an exchange would have
constituted discussions.  See, e.g., Baker Support Servs., Inc.,
B-257054.2, Jan. 20, 1995, 95-1 CPD PA 29 at 7-8 (protester sought
opportunity to *clarify* inadequate staffing levels, our Office explained
agency was not required to hold discussions); Colmek Sys. Eng*g,
B-291931.2, July 9, 2003, 2003 CPD PA 123 at 7 (protester*s request for
opportunity to clarify insufficient estimate of pre-production work would
have been discussions, and agency was not required to hold discussions). 
As noted above, the RFP clearly indicated that the Army intended to make
award without discussions, if possible; therefore, to the extent that
other offerors* proposals were acceptable as written, there was no
requirement for the agency to hold discussions with Dyncorp, whose
proposal reasonably was found to be ineligible for award.  See generally
Colmek Sys. Eng*g, supra.

   Given our conclusion that the Army reasonably evaluated DynCorp*s proposal
as marginal under the staffing plan subfactor, and given that the
solicitation, on its face, advised that a marginal rating under any
technical/management subfactor would result in a marginal rating for the
entire factor, there is no reason for our Office to review DynCorp*s
challenges to its other marginal ratings under the technical/management
subfactors.  Under these circumstances, DynCorp*s marginal rating for the
technical management evaluation factor is consistent with the
solicitation*s stated evaluation scheme.

   Marginal Proposals Excluded from Further Consideration for Award

   We turn next to DynCorp*s contention that since its proposal was rated
marginal rather than unsatisfactory, the SSA was required to consider its
proposal for award, given that its evaluated cost was lower than those of
the two offerors whose proposals were considered in the trade-off
decision.  Again, we disagree. 

   As mentioned in the previous section, the RFP here clearly advised that
the agency intended to make award, if possible, on the basis of initial
proposals.  RFP amend. 5, at 53.  The RFP*s definition of marginal also
advised that it meant that a proposal so rated *may be correctable only
with a significant re-write of the proposal.*  Id. at 51.  In addition,
the SSA here expressly determined that DynCorp*s marginal proposal was
ineligible for award as written due to its significant shortfall in
proposed staffing.  Put simply, since we find that the Army reasonably
concluded that the proposal could not be accepted as written, there was no
requirement to consider it further.  Tomco Sys., Inc., B-275551 et al.,
Mar. 13, 1997, 97-1 CPD PA 130 at 4-5.

   We disagree with DynCorp*s assertion that the situation here is similar to
the situation we reviewed in A&D Fire Prot. Inc., B-288852, Dec. 12, 2001,
2001 CPD PA 201, wherein we sustained a protest after concluding that the
agency improperly eliminated from the competition the protester*s
lower-priced and lower-rated proposal.  In our view, the difference
between these cases lies in both the assessment of the protesters*
proposals, and the instant RFP*s stated evaluation scheme.  In A&D Fire
Prot., there was no suggestion that the protester*s lower-rated proposal
was ineligible for award, and no supportable basis for excluding the
proposal from the cost/technical tradeoff.  Id. at 3.  Here, in contrast,
the SSA expressly concluded that DynCorp*s proposal was ineligible for
award as written, and we have reviewed that conclusion and found it
reasonable.  In addition, in the instant procurement, offerors were on
notice that a marginal rating might result a determination that the
proposal could only be corrected with a significant proposal rewrite,
which would not be available if award was made without discussions.  As a
result, we do not agree that the decision in A&D Fire Prot. is controlling
here.[5]

   Evaluation of Aegis and Aegis*s Responsibility

   With respect to the remaining two areas of DynCorp*s protest--its
challenge to the evaluation of Aegis*s proposal, and its allegation that
Aegis is not a responsible contractor--we find that DynCorp is not an
interested party to raise either issue.

   Under the bid protest provisions of the Competition in Contracting Act of
1984, 31 U.S.C. SS 3551 et seq. (2000), and our Bid Protest Regulations, 4
C.F.R. SA 21.0(a) (2004), only an *interested party* may protest a federal
procurement.  Since we have concluded that the agency reasonably decided
that DynCorp*s proposal was ineligible for award as written, and since
there was another technically acceptable proposal in line for award
(Offeror A*s), even if we were to sustain DynCorp*s challenges to the
evaluation of Aegis*s proposal, or to the determination that Aegis is a
responsible offeror, Offeror A would be in line for award, not DynCorp. 
Thus, DynCorp lacks the direct economic interest necessary to pursue these
challenges.  OMNIPLEX World Servs. Corp., B-282630.2, Sept. 22, 1999, 99-2
CPD PA 64 at 6.   

   The protest is denied.

   Anthony H. Gamboa

   General Counsel

   ------------------------

   [1] The cost shown for the two offerors whose overall rating was
*unsatisfactory*--Offerors C and D in the table above--is the total
proposed cost.  Since these proposals were evaluated as *unsatisfactory*
overall, the agency did not calculate an evaluated cost for their
proposals. 

   [2] This language was repeated verbatim in DynCorp*s Administrative/Cost
Proposal in the section wherein the company provided a *narrative
explanation of the methodology used to develop its Direct Labor Rates,
Other Direct Costs proposed, and assumptions.*  DynCorp Proposal, Vol. 1,
P 2.1.

   [3] There is some confusion about the actual number of escort teams
DynCorp proposed, but the evidence in the record suggests that the matter
has no impact on the dispute here.  As quoted above, DynCorp proposed 4
PSDs at the national level,
1 PSD at each regional level, and 16 security escort teams at the
governorate level, which, the proposal explained, totals 26 teams.  The
Army points out that DynCorp apparently assumed that Iraq would be divided
into 6 regional levels, rather than
4, and that using the proper number of regional levels, DynCorp proposed a
total of 24 teams, rather than 26 teams.  AR, TabA K at 6.  In addition,
the agency noted that
1 of the 4 national PSDs would be reserved for DynCorp*s own staff,
leaving only
23 teams to meet the RFP requirements, which the SSA concluded was an
insufficient number.  Id.  DynCorp never disputed the agency*s
recalculation of the number of teams it proposed, but stated only that
this concern *should have been addressed in clarifications.*  Protester*s
Comments, Aug. 2, at 11.  Given that the protester raises no substantive
challenge to the recalculation, we see no basis to second-guess the Army*s
views on this matter.  To be fair, we note that Aegis*s proposal
[deleted].  See, e.g., AR, Tab E-2 at 19. 

   [4] We note that the awardee proposed [deleted] escort teams [deleted].

   [5] As a final matter--and also unlike A&D Fire Prot., see p.4--the record
here shows that the SSA actually made a contemporaneous tradeoff decision,
as a matter of precaution.  In it, the SSA concluded that he would not
select DynCorp*s proposal over the proposal of Aegis.